Financial companies – including Royal Bank of Scotland - were made to remove or amend 327 adverti...
Regulator scrapped 327 naughty financial adverts last year
The Financial Services Authority won’t name and shame the financial companies which had their advertisements pulled by the regulator for breaking the rules.
Financial companies – including Royal Bank of Scotland - were made to remove or amend 327 advertisements last year by the regulator because they breached the strict rules surrounding such promotions. In 2010, 262 were pulled at the demand of the Financial Services Authority.
However, this information was only obtained after a freedom of information request from consumer group Which? And the regulator will not give details of the offending companies.
Which? says that when it looked at a range of financial advertisements last year, a barrister specialising in consumer law said that several breached the rules. A report in the Financial Times said that one known offender was Royal Bank of Scotland which the Advertising Standards Authority told to stop TV advertisements saying it would keep branches open even if it was the last bank in town after it emerged it had closed NatWest in Farsley, West Yorkshire even though it was the last one remaining.
Changes ahead?
Currently, if you complain about an advert to the FSA you are not even told if your complaint has been upheld. The Advertising Standards Authority, which covers most non-financial adverts, does publish details of its decision on advertisements.
Which? executive director, Richard Lloyd, says:It ridiculous that if you run a misleading advert for chocolate spread your’e named and shamed, but the names of the firms that have issued hundreds of misleading adverts for complex savings, investments, insurance products and bank accounts are kept secret.
Consumers need to know when firms have been forced to withdraw misleading adverts and should not be left to guess whether their decision to sign up to a product was based on a dodgy promotion.
A study by Grant Thornton six years ago found more than three quarters of financial services advertisements did not meet the FSA standards, saying that customers were targeted with jargon, inaccurate details and misleading comparisons.
The good news is that when the Financial Conduct Authority takes over part of the responsibilities of the FSA next year it may be able to name and shame companies when it finds misleading ads.
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Quick tips
- If you see a saving account advert you think is wrong, you should complain to the FSA hotline (08457 300 168)
- All savings account advertisements should quote AERs, annual equivalent rates, so that rates can be compared easily;
- AERs show how much interest youll earn if you leave your money untouched for a year
Use an unbiased comparison site covering all the top savings rates such as We Know Money to find the best place for your money